Faculty and students speak out against TIAA investments in fossil fuels

The Teachers Insurance and Annuity Association of America (TIAA) is the world’s eighth largest holder of oil and gas bonds. (Courtesy: Wikipedia Commons)

In accordance with an uptick in awareness about energy holdings at educational institutions, an April 20 Letter to the Editor in “The New York Review,” co-written by Pitzer College professor Dan Segal, criticizes the investments of professor pensions into the Teachers Insurance and Annuity Association of America (TIAA).

TIAA is a major insurance company that seeks to offer millions of people — namely educators, scholars and arts workers — financial security. Among their massive clientele are the employees at the Claremont Colleges, whose employer-funded retirement accounts are held by TIAA.

Despite the company’s claim to environmentalism, which is displayed on its website with statements about improving the environment and leading TIAA’s industry in modeling sustainable behavior, TIAA has been repeatedly criticized for its contribution to global climate change. 

Members of organizations such as TIAA-Divest!, a nationwide effort urging TIAA to “stop financing climate change,” have cited TIAA’s notable holdings in fossil fuel companies as evidence of its active role in environmental destruction.

A report from the Institute of Energy Economy and Financial Analysis (IEEFA) estimated that $78 billion of TIAA’s $1.2 trillion portfolio is invested in fossil fuels. TIAA is the world’s eighth largest holder of oil and gas bonds, is the world’s fourth largest holder of coal bonds and is a major shareholder in the Adani Group, one of the world’s leading coal operators. The fund also has a stake in ConocoPhillips, the owner and operator of the Willow Project, an oil drilling operation projected to emit 260 million metric tons in carbon emissions.

Laura Muna-Landa, assistant vice president of communications for the Claremont Colleges, added that self-directed brokerage accounts are available for employees, which allow participants to “avoid funds in any particular sector, including energy and utility sectors.”

Segal explained that the calls to divest are not about personal opt-outs from funding fossil fuels but about utilizing the TIAA’s position as a fund of “educators and scientists” to set a precedent among large financial firms.

“This is the retirement fund for some of the most educated people in the country, [including] a lot of faculty at medical schools,” Segal said. “The goal is to deprive the fossil fuel economy of money from our retirements and to make a public statement that any further investments in fossil fuels are illegitimate.”

Segal emphasized the moral imperative of educators to combat fossil fuel usage.

“How any educator, including the president[s] of [the Claremont Colleges], can claim to respect science and oppose divestment is amazing to me. The science tells us we cannot afford to keep burning fossil fuels.”

Since Pitzer’s pledge to divest in 2014, little else has been done to address concerns from faculty and students about the College’s investments in fossil fuel corporations. Aurora Strauss-Reeves PZ ’23, a member of Divest 5C, felt that the inaction reflected poorly on the Claremont Colleges and their values. 

“I think it’s just really hypocritical for these ultra-liberal colleges to be contracting with organizations that don’t care at all about the environment,” Strauss-Reeves said. “They’re working with and paying these organizations that are complicit in global warming.”

In contrast with Segal and Strauss-Reeves, John McCool, vice president of public relations at TIAA, criticized the efficacy of divestment campaigns.

“Divestment cancels [TIAA’s] ability to influence change, maximize returns and meet client demands as part of the global energy transition — and does nothing to remove carbon from the atmosphere, since the carbon assets will [just] be acquired by another asset manager,” McCool said in an email to TSL.

According to McCool, TIAA is taking an entirely different approach to climate change. Instead of defunding the fossil fuel industry, TIAA claims to be creating “long-term environmental change” by engaging with the management of various companies and advocating for transitions to low or no-carbon operations.

“As institutional investors, we wield considerable power,” McCool said. “A seat at the table is more valuable than walking away from it.”

Peter Dien CM ’25, who played a significant role in last year’s divestment campaigns at Claremont McKenna College, rejected TIAA’s strategy, defending the effectiveness of divestment as a vehicle for change.

“That whole idea is so devoid of morality [and] any sort of sense of urgency or action. It’s just a weirdly articulated defense of the status quo,” Dien said. “People think that divestment means taking away money entirely, but divestment implies reinvestment into better things.”

For environmental activists like Segal, a sense of urgency and action is an absolute necessity in addressing an impending climate crisis:

“I’m 65. The planet is gonna be livable for the remainder of my time, but it’s not gonna be liveable for the remainder of [my students’] or my granddaughter’s if we keep burning fossil fuels.”

Peter Dien is a film columnist for TSL.

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